Record Date
The record date is the cut-off date set by a company to determine which shareholders are eligible to receive a corporate action benefit such as a dividend, bonus issue, rights issue, or stock split.
To be entitled to a corporate action, an investor must hold the shares in their demat account on the record date. Given India's T+1 rolling settlement cycle (which moved from T+2 to T+1 for most stocks from January 2023), shares bought must be paid for and settled by the day before the record date to reflect in the buyer's demat account on the record date itself.
The record date is set by the company's board of directors and must be communicated to the stock exchanges in advance, under SEBI's LODR (Listing Obligations and Disclosure Requirements) Regulations. For dividends, at least 15 days' advance notice of the record date must be given after its announcement. This window allows investors and their brokers to plan their holdings accordingly.
The record date interacts closely with the ex-date. In the T+1 settlement era, the ex-date is typically one trading day before the record date (instead of two days in the earlier T+2 regime). On and after the ex-date, the shares trade without the entitlement to the upcoming corporate action benefit. An investor who purchases shares on the ex-date will not receive the dividend or bonus, even if they hold the shares on the record date — because their settlement will complete after the record date.
For retail investors, practical vigilance is needed around record dates. Several investors have missed corporate action entitlements due to confusion about the ex-date versus the record date. Brokers' trading platforms in India increasingly display upcoming ex-dates for dividends and corporate actions to help clients track these dates. NSDL and CDSL also disseminate corporate action information through their portals and via registered intermediaries.
A single company may set multiple record dates in a year — one each for an interim dividend, a final dividend, and a bonus issue. Tracking each separately is important for maintaining accurate cost bases and entitlement records.